Can election results sway mortgage rates?

If you listen to one side there are always too many democratic congressman being elected.  The other side will say there are too many republican congressman being elected.  My question is when do we get the opportunity to elect a US congressman?

Best of luck to all the candidates today.  Please don’t forget to pull your TV ad spending after today so we can watch football in peace this weekend.

The election

Today is election day.  The polls do not suggest a landslide in either direction so we don’t expect the results to influence home loan rates.

Jobs Report

Mortgage rates were enjoying some improvement last week until the all-important jobs report was released on Friday.  The report showed the US economy added 250,000 new jobs last month which was stronger than expected.  Average wages for US workers also increased more than expected (+3.1%).  As expected, mortgage rates moved higher following the release.

The Fed

The Fed will conduct its regularly scheduled monetary policy meeting over the next two days.  The Fed is not expected to hike rates at this meeting but their policy statement may cement their intent to hike at their next meeting in six weeks.  The Fed does not directly control mortgage rates but their comments can influence their direction.

US 10-year treasury note

The US 10-year treasury note is currently yielding 3.20%.  If yields worsen and close above the 3.25% threshold that would be a very bad signal for mortgage rates.  We’ll need to keep a close eye on that.

The Week Ahead

On Thursday we’ll see the Fed’s policy statement and on Friday we’ll get the latest reading on the Produce Price Index.

Current Outlook: locking bias